Notice of Loss in Cargo Claims: 11 Key Questions for Claims Handlers

When cargo arrives at its destination in poor condition or incomplete, the recipient is thrust into a crucial process that starts with making what is commonly referred to as a "reservation" – often known as a "protest" or more formally, a "notice of loss."

This is essentially a written expression of disagreement with the state of the delivered goods.

For those handling cargo claims operating within the domain of transport contracts, a deep understanding of this concept empowers them to competently manage and respond to a variety of important queries and challenges integral to the claims process.

Consignee noting details on a clipboard, documenting receipt of goods
The notice of loss initiates the formal procedure for assessing and addressing the loss or damage under the terms of the transportation contract. It’s important to distinguish this from a claim under a marine insurance policy, which is a separate process involving the insurance provider. The specific requirements and form of a notice of loss can vary depending on the terms of the contract and the nature of the transportation. Therefore, consulting the relevant contractual documents is crucial for understanding the exact definitions and stipulations involved. Let’s explore some key questions about “notice of loss,” a fundamental element in the landscape of cargo transportation and claims management.

1. What is a notice of loss?

A notice of loss is a formal declaration made by the consignee to the carrier, indicating the intent to claim for damages or losses that occurred during the transit of goods. This notification is an essential initial step in the claims process under the transport contract, serving as an official alert to the carrier about the issues with the delivered cargo.

2. Who notified the claim?

In the context of cargo claims under transport contracts, the notification of loss or damage can originate from different parties, each influenced by their role in the shipping process and their exposure to the loss or damage. Typically, the party that first discovers the loss or damage, or is most directly affected by it, assumes the responsibility to notify the claim. This can include:
  • More often, it is the consignee, the recipient of the cargo<, who issues the notice of loss. This is typically done upon receiving the cargo when the consignee might identify damages or discrepancies. Since the consignee is directly affected by the condition of the cargo, they are usually in the best position to notice and report any issues.
  • In some cases, a third party such as a freight forwarder, logistics operator, or legal representative may issue the notice of loss. This usually happens when they are acting on behalf of the shipper or consignee, or when they have identified the loss or damage during their handling of the cargo. It’s important that such notifications are properly authorized and documented to ensure they are recognized in the claims process.

3. Who is the notice of loss for?

The notice of loss should be directed towards the person or company responsible for the transport, or their agent or representative, who is presumed to be the responsible party.

The inclusion of the notice of loss in the consignment note at the time of delivery enables the carrier to:

  • Immediately become aware of any irregularities and prepares them to address a potential claim. This proactive awareness is crucial for taking timely and appropriate actions.
  • Provide legal certainty to both the carrier and their insurer. The carrier not only understands the existence of irregularities but also recognizes the potential need to face a claim related to these irregularities. This helps in preparing their response and any necessary documentation or evidence.
  • Preserve the right to recourse against the actual perpetrator of the damage, especially if they are not the actual carrier. This means that while the claim is initially directed at the carrier, the carrier may have the right to seek compensation from the party truly responsible for the loss or damage.

4. How do you make a notice of loss?

The most common method of making a notice of loss is by recording it in the consignment note.

According to the notification requirements under COGSA (Carriage of Goods by Sea Act), the written notice must be directed specifically to the carrier or their agent, forming a key element in the claim process.

This document is vital as it verifies the existence of the transport contract and details its terms and conditions. The note typically accompanies the goods throughout their journey, making it an accessible and reliable medium for recording any reservations or protests about the cargo’s condition.

It is important to understand that the notice of loss is a unilateral declaration. It does not require the carrier’s acknowledgment, represented by the driver or any other agent, either as a sign of agreement or as a mere receipt of the communication. This highlights the independence of the notice of loss from the carrier’s direct confirmation or acceptance.

While recording the notice on the transport document is crucial, it is also advisable to send a formal protest letter (document) to the carrier. This letter serves as an additional formal record of the notice of loss, providing a more comprehensive approach to documenting the claim.

In Spain, the Law of Land Transport Contract (Ley de Contrato de Transporte Terrestre de Mercancías) provides guidelines for handling road transport cargo claims. This law stipulates that for apparent damage or loss, the consignee must immediately notify the carrier at the time of delivery. This is often done through an annotation on the delivery or consignment note, which should be acknowledged by the carrier. Understanding and following these legal stipulations are vital for the valid and timely processing of claims.

6. In what scenarios is a notice of loss required in cargo transportation?

Here are some of the key scenarios where such actions are necessary:

  • Damage to goods
  • Shortage of goods
  • Late delivery
  • Non-Delivery
  • Concealed damage or loss
  • Incorrect goods

In each of these situations, timely and accurate documentation through a notice of loss is critical for ensuring that the claim is handled appropriately and the rights of the consignee are protected.

7. What information should a notice of loss contain?

A notice of loss typically needs to include the following information:

  • Date and time: The specific date and time when the loss or damage occurred.
  • Detailed description of goods: An in-depth description of the goods that were affected.
  • Estimated value: The estimated value of the loss or damage.
  • Circumstances of Loss: A description of how, where, and why the loss occurred if known.
  • Transport contract details: Relevant information from the transport contract, such as the bill of lading number.
  • Immediate actions taken: Any steps that were immediately taken after discovering the loss.


8. What are the consequences of failing to include a notice of loss?

If a notice of loss is not made in time, the carrier often benefits from a legal presumption that the goods were delivered correctly.

This presumption shifts the burden of proof to the claimant (typically the consignee), making it more challenging to establish that the loss or damage occurred during transit.

Failing to notify a loss within the specified time frames can have significant implications on the validity and success of a cargo claim. Without timely notification, it becomes more difficult for the claimant to prove the extent, cause, and timing of the loss or damage. This can significantly weaken their position in any legal or insurance claim.

Insurers may refuse to cover the loss if the failure to notify constitutes a breach of the policy conditions. Timely notification is often a key condition in insurance contracts.

Imagine a scenario where a consignee, “Oceanic Imports,” receives a shipment of electronic goods via sea transport. Upon delivery, the company’s warehouse manager notices several damaged boxes but decides to delay reporting this due to the busy season and the need to process orders. The manager eventually reports the damage to their insurance company and the carrier 10 days later.

However, the insurance policy stipulates that any damages must be reported within 5 days of receipt for the claim to be valid. Moreover, under the Hague-Visby Rules applicable to sea transport, the notification period for concealed damages is 3 days. Due to these missed deadlines, the insurance company refuses to cover the loss, citing a breach of policy conditions. Additionally, the carrier disclaims liability, arguing that the delay in reporting the damage has made it impossible to ascertain whether the damage occurred during transit or while in the warehouse of “Oceanic Imports.”

As a result, “Oceanic Imports” faces significant financial losses from the damaged goods, compounded by the inability to recover these losses from their insurer or the carrier. This example underscores the importance of adhering to the notification time frames stipulated in insurance policies and international transport regulations.

9. Is a notice of loss an assessment of damages?

A reservation (notice of loss) should not be confused with a formal assessment of damages. It serves a different purpose and has distinct legal implications:

  • Making a reservation does not confirm the actual occurrence of damage.
  • It’s a preliminary step that acknowledges a potential issue with the cargo, rather than a detailed evaluation of any specific damages.
  • The legal value of a reservation lies in its ability to flag a potential issue at the time of delivery. It serves as an early indication that the consignee may later raise a formal claim for damages, subject to further assessment and validation of the actual loss or damage.

10. Is a notice of loss sufficient to initiate an insurance claims process?

There is a widespread but erroneous belief that a notice of loss is enough to later claim compensation from the carrier for damaged or missing goods. However, this is not the case.

A reservation does not equate to an assessment of damages. It neither confirms the actual occurrence of damage nor determines its cause or extent. Rather, it merely indicates disagreement with the state of delivery, serving primarily to counter the presumption of correct delivery of goods at the destination. That is its sole legal value.

This is explained based on the regulatory framework governing the transport contract:

For International Transport: The CMR Convention of May 19, 1956, in its Article 30, states:

  • If the recipient receives the goods without verifying their condition in opposition to the carrier, or if, at the moment of delivery in case of apparent losses or damages, or within seven days from the date of delivery in case of concealed damages or losses (excluding Sundays and holidays), does not express reservations to the carrier indicating the general nature of the loss or damage, it will be presumed, unless proven otherwise, that the goods were received in the state described in the consignment note.


For National Transport within Spain: Law 15/2009 of November 15, in its Article 60.1, states:

  • The recipient must express reservations in writing to the carrier or its assistants, describing the loss or damage in a general way at the time of delivery. In case of non-apparent damages and losses, the reservations must be made within the following seven natural days after delivery.


When no reservations are made, it will be presumed, unless proven otherwise, that the goods were delivered in the state described in the consignment note.

Both regulations are almost identical (in fact, the Spanish law is almost a copy of the Convention). Although the Spanish law seems better drafted as it separates the reservation and its alternative, which is bilateral verification, while Article 30.1 of the CMR contemplates them jointly, and its wording is clearer.

Another difference is that the CMR only requires reservations about non-apparent damages to be written, while the national law requires all of them to be in writing. However, in practice, in international transport, reservations are also made in writing, specifically in the consignment note.

The implication of both regulations – for national and international transport – is the same. What they establish – read carefully, as they are stated only in a negative form – is that if no reservations are made at the destination, it is presumed that the goods were delivered correctly.


11. What is the next step after including a notice of loss?

Once the notice of loss is included in the consignment note, the subsequent steps are crucial for effectively managing the claim process. These steps typically involve:

  • Submitting a formal claim: This involves compiling and submitting all required documentation to support the claim. The documentation should provide detailed information about the nature and extent of the loss or damage.
  • Damage assessment by surveyors or inspectors: Engaging with professional surveyors or inspectors to assess the damage is a key step. Their evaluation will be critical in determining the severity and cause of the loss.
  • Continuous communication: Maintaining ongoing communication with the carrier and the insurance company is essential for the smooth handling of the claim. This ensures that all parties are informed about the claim’s status and any developments.
  • Follow-up on claim progress: Actively following up on the progress of the claim is necessary for a timely resolution. This includes responding to any inquiries and providing additional information as needed.

In cases where the goods are recoverable or salvageable, appropriate and reasonable measures should be taken based on the nature of the damage, type of goods, and specific circumstances.

These measures might include costs for salvage, such as storage, additional transportation, protection, etc. Such expenses are normally covered under a cargo insurance policy. Therefore, it is crucial to keep all relevant documentation of these expenses, as they are important for the claim process.

Final key recommendations:

  • Act Promptly and adhere to time limits
  • Maintain detailed documentation
  • Understand legal terms and seek advice
  • Consulting with maritime law professionals is invaluable for tailored advice and effective management of claims in compliance with legal standards.


At Marlin Blue, we provide specialized advice and effective management of claims, ensuring compliance with legal standards. Visit our Services Page for more information on how we can assist you.

For further insights and guidance, we encourage readers to explore the resources available on our website. Please refer to our About us page for an overview of our expertise in maritime law and Contact us for personalized advice on cargo claims.


  • Insuring Cargoes: A Practical Guide to the Law and Practice’, 2nd Edition, 2023.
  • Diego Esteban Chami, ‘La Protesta Aeronáutica: Teoría y Práctica’ (Abeledo Perrot).
  • “Carriage of Goods by Sea Act 1971”,, available at <> accessed [15/11/2023].

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